This Day in History: The Dow Jones Industrial Average closed down 733.08 points, or 7.87% on this day in 2008, making it one of the worst percentage drops in the Dow's history. The worst was on October 19 1987 (-22.61%) and October 1929 had worse drops as well. October has a special place in finance, known as the October effect, and is one of the most feared months in the financial calendar. The 2nd, and 5th worst market drops actually happened earlier this year in March. There was also a -8.72% drop in late 1899.
Interestingly, two days prior, October 13 2008, had one of the biggest percentage gains in stock market history (+11.08%).
There is another problem with stock market numbers, like the Dow Jones Industrial Average and the S&P 500. The new record levels are counted in "nominal" terms. The numbers don't account for inflation. I know that back in 2013 financial experts noticed the high numbers in the stock market, but in reality, when adjusted for inflation, they stated that the market was actually higher in 1999. For instance, in 2013, the Dow could buy 15.35 tons of bananas, but in 1999, the Dow could have bought 38.51 tons of bananas.
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